Plan Your Budget for Influencer Marketing

Plan Your Budget for Influencer Marketing

Setting up as many advertising campaigns as one wishes, implementing strategies effortlessly, having easy access to all the tools needed to monitor performances: in the corporate world, many people dream of being able to realise their vision with no limits. But unfortunately, in real life, small problems have a way of catching up with us. The first one to arise is often the budget.

Each year, companies reflect on how much money they should dedicate to each strategy. In the marketing sector, such decisions affect in particular the next campaigns (both digital and offline). The goal is to come up with campaigns that move forward with companies’ goals. For instance, marketers can seek to improve brand imageincrease sales or even build a community and improve brand awareness on a social media platform.

Setting a budget early in the year allows marketing teams to know what they can afford to do. Budgets need to be decided on before drafting a strategic plan for the next 12 months. But we have some good news for you: marketing budgets, after decreasing in 2020 and again in 2021, have risen again throughout 2022.

Media budgets of companies in 2022

In April 2022, a study was conducted by the American consulting firm Gartner. Their team went out and interviewed 405 Chief Marketing Officers and other marketing executives in North America, Northern and Western Europe between February and March 2022. These companies operate in several sectors, are of varying sizes and have different revenues. Most of them have a turnover of more than 1 billion dollars.

Over 2022 as a whole, they reported a small increase of their marketing budgets when compared to 2021. Indeed, 9.5% of their turnover is now dedicated to marketing compared to 6.4% the previous year. While this might not seem much, it’s reassuring to know that three out of four CMOs say they have increased their budgets. This is good news for agencies who help them creating their campaigns. Nonetheless, Gartner notes that it remains well below what was seen between 2018 and 2020. At that time, marketing budgets accounted for more than 10% of a company’s turnover.

Despite a difficult economic environment over the past two years, “marketers seem optimistic”, says Gartner. For example, according to analysts, the majority of CMOs surveyed believe that inflationary pressures on their companies and customers will have a positive impact on their strategy and investments in 2022.

Companies’ budgets are re-evaluated every year for one simple reason: turnovers change from one year to another and so should the strategies and their allocated budget. For example, for the past ten years, investments in influencer marketing have been steadily increasing. By 2025, the sector is expected to be worth $22.2 billion. In 2021, that number was $13.8 billion. If this amount keeps growing, it’s because the tools and features used in influencer marketing are getting more and more extensive. For instance, you can create talk shows on Twitch and livestreams with influencers on Instagram. This means that a production team needs to be hired to work on the project. Partnering with influencers is no longer limited to product placement. The sector is growing, thanks to the investment and work of companies. And it all comes down to the budget.

Digital marketing spending is increasing

Digital marketing provides endless ways to target your audience as well as various strategies. Brands have clearly understood this and it has resulted to bigger turnovers. Nevertheless, they’d be wise to remember not to put all their eggs in one basket. While the Internet offers great opportunities, let’s not forget the other options, because everything works together as a whole.

According to the same study by Gartner, marketing strategies are becoming increasingly hybrid. Digital marketing accounts for 56% of marketing investments so clearly not all of it goes to online channels. Marketers are coming up with hybrid multi-channel strategies. “This distribution is more equal than in recent years”, says Gartner. “There has been a lot of discussion around COVID-19 shifting consumers to a digital first mindset. However, as Western Europe and North America relax pandemic protocols, customer journeys have recalibrated. Post-lockdown, CMOs need to listen carefully to their customers and pay attention to the channels they are using, as this more closely resembles a hybrid reality.”

Hybrid strategies are also used in influencer marketing campaigns. For several years now, content creators appearing both on brands’ online and offline campaigns has been a common occurrence.

For example, for its latest collaboration, the lingerie brand Intimissimi partnered with several influencers. They took part in a photo shoot to promote new bras. These photos were shared on Instagram profiles as well as displayed in stores. This is what we call a hybrid multichannel strategy.

Media budgets for influencer marketing

Relying on content creators for  digital marketing campaign has become a habit. Unlike a few years ago, these strategies now tend to also appear on offline channels. Indeed digital campaigns now crossover with billboard, television and radio advertising. Influencers are increasingly sought-after to embody brands and their campaigns. Influencer marketing offers great opportunities for businesses and allows them to exploit all media channels (online and offline). This is why influencer marketing budgets are constantly increasing. The results are there and the projects tend to be very innovative.

Investment in social media is expected to continue growing. By 2025, Forrester predicts that global marketing investment will grow by 30% to reach $4.7 trillion.

Do you plan on increasing your budgets in order to incorporate more influencer marketing in your campaigns?

 Contact us here!

Our budget simulation tool

To help you calculate your media budget, we’ve created a free tool:

Budget simulation tool

To learn more about influencer marketing, read our other articles dedicated to the topic like Why You Should Include Influencer Marketing in Your Annual Marketing Plan.

Sources: GartnerForrester

Ecrit par Jordan Plummeridge

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